Do Overtime Rules Apply to Missed Meal Breaks in California?

An opinion issued on July 15, 2021 by the California Supreme Court in regard to meal period premiums impacts employers providing non discretionary payments for work performed by California employees.

The Case: Ferra v. Loews Hollywood Hotel, LLC

The Court: California Supreme Court

The Case No.: S259172

The Issue: Ferra v. Loews Hollywood Hotel, LLC

​​Generally speaking, non-exempt California workers may not work more than five hours without an uninterrupted meal period of at least 30 minutes being offered by their employer. If a California worker completes a shift longer than 10 hours, a second unpaid period of at least 30 minutes is required. An employee may waive their first meal period if six hours completes their day at work. The second meal period may be waived by the employee if the first meal period wasn’t waived and if the California employee’s shift is no longer than 12 hours. Additionally, California employers must provide rest breaks (for a minimum of 10 minutes) to their employees for every three and half hours they work. Employees cannot waive their mandatory rest breaks. When employees are not able to take their mandated meal breaks or rest breaks, employers must pay the employee a premium (Labor Code Section 226.7(c)).

The Question: Ferra v. Loews Hollywood Hotel, LLC

California law requires employers to provide one hour of pay for each workday in which they miss their mandatory meal breaks or rest periods. Prior to Ferra v. Loews Hollywood Hotel, LLC, employers and the lower courts seemed to agree that the premium for a missed meal or rest period was one hour of pay at the employee’s regular rate or pay. The case at hand brought up the question of whether or not Labor Code Section 226.7(c) ‘s reference to an employee’s “regular rate of pay” should take into account non discretionary forms of payment earned by employees in addition to their hourly wage. The reasoning presented in the case compared the calculation of compensation for missed meal and rest periods to the calculations used for overtime pay rates.

The Ruling: California Justices Say Overtime Rules Do Apply To Missed Meal Breaks

The California Supreme Court held that meal period premiums must consider non discretionary payments when designating the employee’s regular rate of compensation. Non Discretionary payments can refer to a variety of pay methods, but a common form of non discretionary pay is a bonus. In addition, the Court held that the decision would apply retroactively. The statute of limitations for underpaid or unpaid meal and rest break premiums is three years (or four years if the plaintiff also alleges a violation of California’s Unfair Competition Law). Claims under Private Attorneys General Act have a statute of limitation period of one year.

If you have questions about payment for missed meal breaks or rest periods or if you’ve experienced other labor law violations, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.